United States Government Accountability Office

GAO Report to Congressional Requesters

VETERANS’

BENEFITS 

Further Changes in 

VBA’s Field Office 

Structure Could Help 

Improve Disability 

Claims Processing 

December 2005 

 

GAO-06-149 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

December 2005

VETERANS' BENEFITS

Further Changes in VBA's Field Office 

Structure Could Help Improve Disability 

Claims Processing 

Highlights of GAO-06-149, a report to 

congressional requesters 

The Chairman, former Chairman, 

and Ranking Minority Member, 

Senate Committee on Veterans’ 

Affairs asked GAO to review the

Veterans Benefits Administration’s 

(VBA) efforts to realign its 

compensation and pension claims

processing field structure to 

improve performance. This report 

(1) identifies the actions VBA has 

taken to realign its compensation

and pension claims processing field

structure to improve performance,

and (2) examines whether further

changes to its field structure could

improve performance. 

What GAO Recommends

To help ensure more timely, 

accurate, and consistent decisions 

in a cost-effective manner, we

recommend that the Secretary of

Veterans Affairs (VA) direct the 

Under Secretary for Benefits to

undertake a comprehensive review

of VBA’s field structure for 

processing disability compensation 

and pension claims. This review

would address staff deployment, 

opportunities for consolidating 

disability compensation and 

pension claims processing, and

human capital and real property 

issues. 

VA concurred fundamentally with 

GAO’s recommendation and noted 

that field restructuring is a 

complex process. It stated it will 

establish a task force to thoroughly

explore potential areas for 

consolidation. 

Since 2001, VBA has made a number of changes to its field structure and 

staff deployment in an effort to improve compensation and pension claims 

processing performance, in particular, to improve the timeliness of claims 

decisions and reduce inventories. VBA 

• created a Tiger Team to complete very old claims, and claims from

elderly veterans, 

• created nine resource centers to decide claims developed at the regional 

offices of jurisdiction, 

• consolidated pension maintenance work at three regional offices to free 

up staff at other offices to concentrate on other work, 

• consolidated in-service dependency and indemnity compensation claims 

at one office,

• consolidated processing of appeals remanded from VA’s Board of 

Veterans Appeals at one office, and 

• is consolidating decision making on Benefits Delivery at Discharge 

(BDD) claims at two regional offices.

 

While VBA has taken these steps to improve its claims processing

performance through targeted realignments of its field structure and 

workload, VBA has not changed the basic field structure for processing 

claims for disability compensation and pension benefits, and it still faces 

performance challenges. VBA continues to process these claims at 57

regional offices, where large performance variations and questions about 

decision consistency persist. For example, in fiscal year 2004 the average 

time to decide a rating-related claim ranged from 99 days at one office to 237 

days at another, and accuracy varied across regional offices. Furthermore, 

productivity improvements are necessary to maintain performance in the 

face of greater workloads and relatively constant staffing resources. VBA

and others who have studied claims processing have suggested that 

consolidating claims processing into fewer regional offices could help 

improve claims processing efficiency, save overhead costs, and improve 

decision accuracy and consistency. 

VBA’s 57 Regional Offices Process Disability Claims 

www.gao.gov/cgi-bin/getrpt?GAO-06-149.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Cynthia A. 

Bascetta at (202) 512-7215 or 

bascettac@gao.gov.. 
Contents 

Letter 1

Results in Brief 2 

Background 3

VBA Has Used Limited Field Restructuring and Staff Redeployment 

to Improve Compensation and Pension Performance 5 

VBA Continues to Face Challenges as It Realigns Its Compensation 

and Pension Field Structure 8 

Conclusions 12

Recommendation for Executive Action 12 

Agency Comments and Our Response 12 

Appendix I Scope and Methodology 14 

Appendix II Comments from the Department of Veterans Affairs 17 

Abbreviations 

BDD Benefits Delivery at Discharge 

DOOR Distribution of Operational Resources 

FTE full-time equivalent 

NPRC National Personnel Records Center 

PA&I Office of Performance Analysis and Integrity 

STAR Systematic Technical Accuracy Review 

VA Department of Veterans Affairs 

VBA Veterans Benefits Administration 

VSR veterans service representative 

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Page i GAO-06-149 Veterans' Benefits
United States Government Accountability Office

Washington, DC 20548 

December 9, 2005 

The Honorable Larry E. Craig 

Chairman 

The Honorable Daniel K. Akaka 

Ranking Minority Member 

Committee on Veterans’ Affairs 

U.S. Senate 

The Honorable Arlen Specter 

United States Senate 

Providing veterans and their survivors with timely, accurate, and 

consistent decisions on their claims for disability compensation and 

pension benefits has been a long-standing challenge for the Department of 

Veterans Affairs (VA). Veterans continue to experience lengthy waits for 

decisions, and VA’s Veterans Benefits Administration (VBA) continues to 

experience excessive claims inventories and problems with decision 

accuracy. These performance problems are one reason why we designated 

VA and other federal disability programs as a High-Risk area in January 

2003.

1

 We have noted that to enable it to handle an increasing claims 

workload without significant increases in staffing resources, VBA needs to 

improve claims processing productivity.2

 Also, we have reported that VBA 

needs to improve its ability to provide veterans with consistent 

decisions—that is, comparable decisions on benefit entitlement and rating 

percentage for comparable disabilities regardless of the regional offices 

making the decisions.3

 Improving VBA claims processing performance, and 

positioning the agency to deal with future workload changes, depends in 

part on VBA’s ability to maintain a highly qualified and productive claims 

processing workforce deployed where it can be utilized most effectively. 

 1

GAO, High-Risk Series: An Update, GAO-03-119 (Washington, D.C.: January 2003). 

2

For example, see GAO, Veterans’ Disability Benefits: Claims Processing Problems 

Persist and Major Performance Improvements May Be Difficult, GAO-05-749T 

(Washington, D.C.: May 26, 2005). 

3

For example, see GAO, VA Disability Benefits: Board of Veterans’ Appeals Has Made

Improvements in Quality Assurance, but Challenges Remain for VA in Assuring 

Consistency, GAO-05-655T (Washington, D.C.: May 5, 2005). 

Page 1 GAO-06-149 Veterans' Benefits
At your request, we reviewed VBA’s efforts to realign its compensation and 

pension claims processing field structure to improve productivity, 

timeliness, accuracy, and consistency, and to allow VBA to deal with 

significant workload changes. Specifically, we (1) identified the actions 

VBA has taken to realign its compensation and pension claims processing 

field structure to improve performance and (2) examined whether further 

changes to its field structure could improve performance. 

To develop the information for this report, we reviewed VBA’s model for 

allocating staff to its regional offices and discussed the allocation model 

with VBA officials. We also analyzed VBA staffing data from fiscal years 

2001 through 2004 for VBA’s regional offices. To determine the range in 

workload and performance of VBA’s regional offices, we reviewed VBA 

workload, timeliness, and accuracy data. We assessed the reliability of 

VBA’s timeliness and workload data and found the data sufficiently 

reliable for the purposes of this report. We also assessed the reliability of

VBA’s fiscal year 2004 accuracy data and found that the accuracy data 

were sufficiently reliable to show the differences between VBA’s most and 

least accurate offices (see app. I). To discuss VBA initiatives and the 

impacts of changes in staffing levels, we visited the VBA regional offices in 

Washington, D.C.; Boston, Massachusetts; Newark, New Jersey; 

Philadelphia, Pennsylvania; and Salt Lake City, Utah. Also, while visiting 

the Salt Lake City regional office, we interviewed by videoconference 

officials of the Anchorage, Alaska, and Fort Harrison, Montana, regional 

offices, which are operated by the Salt Lake City regional office. We 

conducted our review from November 2004 through October 2005 in 

accordance with generally accepted government auditing standards. 

Since 2001, VBA has made several targeted changes to its field structure 

and staff deployment in an effort to improve compensation and pension 

claims processing performance, in particular to improve claims processing 

timeliness and reduce rating-related claims inventories. VBA established a 

Tiger Team in October 2001, including experienced rating specialists, to 

complete very old claims and claims from elderly veterans. At the same 

time, VBA established nine resource centers, where teams of rating 

specialists decided claims developed at the regional offices of jurisdiction. 

Further, VBA consolidated specific types of work, including pension 

maintenance work (such as annual means testing for VA pension 

beneficiaries) at three regional offices in January 2002 in an effort to free 

up staff at other offices to concentrate on rating-related claims. VBA also 

consolidated in-service dependency and indemnity compensation claims at 

one office in August 2002, and appeals remanded from VA’s Board of 

Results in Brief 

Page 2 GAO-06-149 Veterans' Benefits
Veterans Appeals at one office in July 2003. Finally, VBA is in the process 

of consolidating decision-making on Benefits Delivery at Discharge (BDD) 

claims at two regional offices. 

While VBA has taken these steps to improve its claims processing 

performance through limited realignments of its field structure and 

workload, VBA has not changed the basic field structure for processing its 

key workload—claims for disability compensation and pension benefits—

and it still faces performance challenges such as improving disability 

compensation and pension claims processing timeliness, decision-making 

accuracy and consistency, and productivity. VBA continues to process 

these claims at 57 regional offices, where large performance variations and 

questions about decision consistency persist. For example, in fiscal year 

2004, the average time to decide a rating-related claim ranged from 99 days 

at one office to 237 days at another, while the accuracy of rating-related 

decisions ranged from 76 to 96 percent. In addition, we have noted that 

VBA faces continuing questions about its ability to ensure that veterans 

receive consistent decisions, regardless of which regional offices decide

their claims. Furthermore, our prior work found that productivity 

improvements are necessary to maintain performance in the face of 

greater workloads and relatively constant staffing resources. VBA and 

others who have studied claims processing have identified various options 

for changing the basic field structure in order to improve claims 

processing efficiency, reduce overhead costs, and improve decision 

accuracy and consistency, including consolidating claims processing into 

fewer than 57 regional offices. No matter which alternative VBA chooses 

to pursue, a broad array of human capital and real property issues would 

need to be addressed. 

This report contains a recommendation to the Secretary of Veterans 

Affairs to have VBA extend its improvement efforts by undertaking a 

comprehensive reexamination of its compensation and pension claims 

processing field structure, including staff deployment, opportunities to 

consolidate claims processing operations, and related human capital and 

real property management issues. VA concurred fundamentally with our 

recommendation and noted that field restructuring is a complex process. 

It stated it will establish a task force to thoroughly explore potential areas 

for consolidation. 

VBA’s disability compensation and pension claims processing is done in its 

57 regional offices. Each state, except Wyoming, has at least 1 regional

office; California has 3, and New York, Pennsylvania, and Texas have 2 

Background 

Page 3 GAO-06-149 Veterans' Benefits
each. VBA also has regional offices in Washington, D.C.; San Juan, Puerto

Rico; and Manila, the Philippines. Also, VBA has 142 Benefits Delivery at

Discharge sites, where VBA staff process claims from newly separated 

service members. In fiscal year 2004, VBA spent about $926 million to 

administer its disability compensation and pension programs. This 

included support for about 9,100 full-time equivalent (FTE) employees. 

In fiscal year 2004, VBA received about 771,000 rating-related claims from 

veterans and their families for disability benefits. This included about 

195,000 original claims for compensation of service-connected disabilities 

(injuries or diseases incurred or aggravated while on active military duty), 

and about 438,000 reopened compensation claims.4

 In addition, about 

87,000 original and reopened claims were filed for pensions for wartime 

veterans who have low incomes and are permanently and totally disabled 

for reasons not service-connected, and their survivors.5

 In addition, VBA 

received about 29,000 original claims for dependency and indemnity 

compensation from deceased veterans’ spouses, children, and parents and 

to survivors of service members who died on active duty. 

When a veteran or other claimant submits a claim for disability 

compensation, pension, or dependency and indemnity compensation to a 

VBA regional office, veterans service center staff process the claim in 

accordance with VBA regulations, policies, procedures, and guidance. A 

veterans service representative (VSR) in a predetermination team develops 

the claim, that is, assists the claimant in obtaining sufficient evidence to 

decide the claim. For rating-related claims, a decision is made in a rating 

team by rating veterans service representatives (also known as rating 

specialists). VSRs also perform a number of other duties, including 

establishing claims files, authorizing payments to beneficiaries and 

generating notification letters to claimants, conducting in-person and 

telephone contacts with veterans and other claimants, and assisting in the 

processing of appeals of claims decisions. 

 4

A reopened compensation claim could be filed by a veteran seeking an increase in 

disability rating based on the worsening of a service-connected disability, or by a veteran 

seeking compensation for a previously unclaimed disability.

5

Veterans age 65 and older do not have to be permanently and totally disabled to become 

eligible for pension benefits, as long as they meet the other requirements for income and 

military service. VBA also pays pensions to surviving spouses and unmarried children of

deceased wartime veterans. 

Page 4 GAO-06-149 Veterans' Benefits
For a number of years, VBA’s regional offices have experienced problems 

processing veterans’ disability compensation and pension claims. As we 

reported in May 2000, VBA’s regional offices still experience problems 

such as large backlogs of pending claims, lengthy processing times, and 

questions about the consistency of its regional office decisions.6

 VBA has 

acknowledged the need to improve the timeliness and accuracy of claims 

processing. 

Since 2001, VBA has made a number of changes to its field structure and 

staff deployment in an effort to provide veterans with faster decisions and

reduce its rating-related claims inventory. In October 2001, VBA 

established a Tiger Team, including experienced rating specialists, to 

complete very old claims and claims from elderly veterans. Also, to 

supplement regional offices’ claims processing capacity, VBA established 

nine resource centers, where teams of rating specialists decided claims 

developed at the regional offices of jurisdiction. Further, VBA has 

consolidated specific types of work, including pension maintenance work 

(such as annual means testing for VA pension beneficiaries) at three 

regional offices, in an effort to free up staff at other offices to concentrate

on rating-related claims. VBA also consolidated in-service dependency and 

indemnity compensation claims at its Philadelphia regional office; created 

an Appeals Management Center in Washington, D.C., to process appeals

remanded from VA’s Board of Veterans Appeals; and is consolidating the

rating of Benefits Delivery at Discharge claims at the Salt Lake City and 

Winston-Salem, North Carolina, regional offices. Further, VBA reduced the 

jurisdictions of two regional offices with inadequate performance—

Washington, D.C., and Newark—to reduce their claims workloads. 

VBA Has Used 

Limited Field 

Restructuring and 

Staff Redeployment to 

Improve 

Compensation and 

Pension Performance 

In fiscal year 2002, VBA established special units to supplement regional

offices’ claims processing capacity, as part of its effort to achieve ratingrelated decision timeliness improvement and reduce its pending claims 

inventory. The Tiger Team at the Cleveland, Ohio, regional office was 

tasked to process very old claims (pending 1 year or more), and claims by

elderly veterans (aged 70 and older). The Tiger Team was staffed with 

experienced rating specialists and with veterans service representatives, 

primarily from the Cleveland office’s staff, to perform whatever additional

development work was needed on the claims they receive and to make 

 6

GAO, Veterans Benefits Administration: Problems and Challenges Facing Disability

Claims Processing, GAO/T-HEHS/AIMD-00-146 (Washington, D.C.: May 18, 2000). 

Page 5 GAO-06-149 Veterans' Benefits
rating decisions on these claims. To help expedite development work, VBA 

obtained priority access for the Tiger Team to obtain evidence from VA 

and other federal agencies. For example, VA and the National Archives 

and Records Administration completed a memorandum of understanding 

in October 2001 to expedite Tiger Team requests for service records at the 

National Personnel Records Center (NPRC) in St. Louis, Missouri. Also, 

VBA established procedures and time frames for expediting Tiger Team 

requests for medical evidence and examinations from the Veterans Health 

Administration. In fiscal year 2004, the Tiger Team completed over 14,000

decisions. Since its creation in fiscal year 2002, the average age of VBA’s 

inventory of rating-related claims has declined from 182 days at the end of

September 2001 to about 118 days at the end of September 2004. 

In addition, VBA supplemented regional offices’ capacity to make claims 

decisions by establishing resource centers at nine regional offices.7

 The 

resource centers, staffed with rating specialists who were less experienced 

than the Tiger Team’s, were to decide “ready to rate” claims. These are 

claims where veterans service representatives at the regional offices of 

jurisdiction had developed the evidence needed to support decisions on 

the claims. In fiscal year 2004, the nine resource centers completed about

69,000 decisions. Since their creation, the inventory of rating-related 

claims has declined from about 421,000 to about 321,000 claims at the end 

of fiscal year 2004. 

VBA has also consolidated some specific types of compensation and 

pension work into specialized units. In January 2002, VBA consolidated 

pension maintenance work at three regional offices—St. Paul, Minnesota; 

Philadelphia; and Milwaukee, Wisconsin. This work involves, for VBA’s 

means-tested pension programs, conducting periodic income and 

eligibility verifications for beneficiaries. In fiscal year 2004, the Pension 

Maintenance Centers completed over 200,000 pension maintenance

actions. In addition to consolidating pension maintenance, VBA plans to 

consolidate all pension claims processing at the three Pension 

Maintenance Centers. 

VBA also consolidated in-service dependency and indemnity 

compensation claims at the Philadelphia regional office. These claims are 

 7

The resource centers are located at the regional offices in San Diego, California; St.

Petersburg, Florida; Togus, Maine; St. Louis, Missouri; Muskogee, Oklahoma; Philadelphia, 

Pennsylvania; Columbia, South Carolina; Seattle, Washington; and Huntington, West

Virginia. 

Page 6 GAO-06-149 Veterans' Benefits
filed by survivors of service members who die while in military service.8

VBA consolidated these claims as part of its efforts to provide expedited

service to these survivors, including service members who died in 

Operations Enduring Freedom and Iraqi Freedom. 

VBA has also consolidated the processing of decisions remanded on 

appeal by VA’s Board of Veterans Appeals. Effective February 2002, VA 

issued a new regulation to streamline and expedite the appeals process. 

The new regulation allowed the board to process remanded decisions 

without having to send them back to VBA regional offices. To implement 

this regulation, the board established a unit to process remanded appeals. 

However, in May 2003, the U.S. Court of Appeals for the Federal Circuit 

held that the board could not, except in certain statutorily authorized 

exceptions, decide appeals in cases in which the board had developed 

evidence. As a result, VBA regained responsibility for evidence 

development and adjudication work on remands, and chose to establish a

centralized Appeals Management Center at its Washington regional office. 

According to VBA officials, remand processing was consolidated because 

a consolidated unit, focusing only on remands, could process them faster 

and more consistently, and with better accountability, than the individual 

regional offices. VBA’s Washington regional office was chosen because of 

its proximity to the board’s headquarters. The Appeals Management 

Center was established in July 2003, and was, according to VBA officials, 

fully operational by February 2004. According to a VBA official, it was 

staffed largely through transfers from regional offices and with staff from 

the board’s former remand processing unit. 

VBA continues to consolidate specific types of claims processing work. 

VBA is in the process of consolidating decision making on Benefits 

Delivery at Discharge claims, which are generally original claims for 

disability compensation, at the Salt Lake City and Winston-Salem regional 

offices. VBA established this program to expedite decisions on disability 

compensation claims from newly separated service members. A service 

member can file a BDD claim up to 180 days before separation; VBA staff 

performs some development work on the claim before separation. VBA 

actually decides the claim after the service member is separated, and the 

official discharge form (DD Form 214) is received. Under the

consolidation, regional offices and BDD sites will accept and develop 

 8

VBA also provides dependency and indemnity compensation to survivors of certain 

deceased disability compensation beneficiaries. 

Page 7 GAO-06-149 Veterans' Benefits
claims, but will send the developed claims to Salt Lake City or WinstonSalem for decision. VBA expects this consolidation to help improve 

decision efficiency and consistency. Consolidation began in December 

2004 and is expected to be completed by March 2006. According to VBA 

officials, claims processing performance was one reason for selecting

these two regional offices. In the case of Salt Lake City, the availability of

space and the ability to recruit new claims processing staff were also 

factors. The Salt Lake City office is in a relatively new building on the 

campus of the Salt Lake City VA Medical Center.

VBA has also made changes in the jurisdictions of some regional offices. 

The Washington regional office has lost most of its jurisdiction. Claims 

from veterans residing in Washington’s Maryland and Virginia suburbs 

were transferred to the Baltimore, Maryland, and Roanoke, Virginia, 

regional offices, respectively. The Washington regional office’s staff 

declined by about 37 percent between fiscal year 2001 and 2004. Also, 

jurisdiction over claims from veterans residing outside the United States 

was transferred from Washington to the Pittsburgh, Pennsylvania, regional

office.9

 Meanwhile, the Newark regional office lost jurisdiction over claims 

from veterans in seven southern New Jersey counties to the Philadelphia 

regional office. The Newark regional office lost about 16 percent of its 

staff between fiscal year 2001 and 2004. These shifts in jurisdiction were, 

according to VBA officials, in response to poor performance by the 

Washington and Newark regional offices, such as inadequate timeliness 

and accuracy. 

While VBA has done limited field restructuring and claims processing staff 

reallocation, it has not changed the basic field structure for processing 

claims for disability compensation and pension benefits and still faces 

challenges in improving performance. VBA continues to process claims at 

57 regional offices, which experience large performance variations and 

questions about the consistency of their decisions. In addition, we have 

reported that in order to improve long-term performance in the face of 

increased workloads and without significant staffing increases, VBA needs 

to improve its productivity. Several studies by VA and outside groups have 

suggested that VBA could improve claims processing efficiency and 

VBA Continues to 

Face Challenges as It 

Realigns Its 

Compensation and 

Pension Field 

Structure 

 9

Other regional offices have jurisdiction for claims from veterans residing outside the 

United States. Veterans residing in Canada can file claims with VBA’s White River Junction, 

Vermont, regional office; veterans residing in Mexico, Central and South America, and the 

Caribbean can file claims at the Houston, Texas, regional office. 

Page 8 GAO-06-149 Veterans' Benefits
consistency by consolidating claims processing into fewer offices as well 

as other strategic changes. In taking on these broader changes, however, 

VBA would need to consider an array of human capital and real property 

challenges, such as optimizing its ability to recruit and retain staff and 

minimizing the cost of office space. 

VBA continues to struggle to improve nationwide performance, and 

significant performance differences exist among its regional offices. For 

example, in fiscal year 2004 the average time to complete rating-related 

claims VBA-wide was 166 days, far from VBA’s strategic goal of 125 days. 

Average completion times ranged from 99 days at the Salt Lake City 

regional office to 237 days at the Honolulu, Hawaii, regional office. To help 

struggling offices reduce their inventories of pending claims, VBA has 

been brokering (that is, having a regional office send a claim to another 

office to be decided) tens of thousands of rating-related claims. In fiscal 

year 2004, regional offices brokered out about 92,000 claims—about 90 

percent to the Tiger Team and resource centers. This action enabled some 

individual offices reduce the size and age of their pending inventories. For 

example, the Providence, Rhode Island regional office brokered out about 

two-thirds of its rating-related decisions in fiscal year 2004. This helped 

Providence to reduce its rating-related inventory by almost 30 percent, 

while the nationwide inventory of pending claims grew by more than 25

percent. Also, Providence was able to reduce its inventory’s average age 

by about 7 weeks, while the nationwide inventory’s average age increased 

by about 1 week. 

VBA also experiences problems ensuring the accuracy and consistency of

its rating decisions. As measured by VBA’s Systematic Technical Accuracy 

Review (STAR) data for fiscal year 2004, the accuracy of regional office

decisions varied from a low of 76 percent at its Boston regional office to 96

percent at its Fort Harrison regional office. Moreover, as we recently

testified and reported, VA still needs to develop a plan for assessing 

variations in disability claims decisions and whether they are within the 

bounds of reasonableness.10 While some variation is inherent in the claims 

decision-making process, we have reported in the past on wide variations 

in the state-to-state average compensation payments per disabled veteran, 

and more recently, VA’s inspector general has found that inconsistency 

remains a problem. 

 10GAO-05-655T and GAO, Veterans Benefits: VA Needs Plan for Assessing Consistency of 

Decisions, GAO-05-99 (Washington, D.C.: Nov. 19, 2004). 

Page 9 GAO-06-149 Veterans' Benefits
In addition to the challenges VBA faces in improving claims processing 

timeliness and consistency, VBA also faces productivity challenges. In 

November 2004, we reported that to achieve its claims processing 

performance goals in the face of increasing workloads and decreased 

staffing levels, VBA would have to rely on productivity improvements. 

VBA’s fiscal year 2006 budget justification provided information on actual

and planned productivity, in terms of rating-related claims decided per 

direct full-time equivalent employee, and identified a number of initiatives 

that could improve claims processing performance. These initiatives 

included technology initiatives such as Virtual VA, involving the creation

of electronic claims folders; consolidation of the processing of Benefits 

Delivery at Discharge claims at 2 regional offices; and collaboration with 

the Department of Defense to improve VBA’s ability to obtain evidence, 

such as evidence of in-service stressors for veterans claiming serviceconnected post-traumatic stress disorder. VBA’s fiscal year 2006 budget 

justification assumed that it would increase the number of rating-related 

claims completed per FTE from 94 in fiscal year 2004 to 109 in fiscal year 

2005 and 2006, a 16 percent increase. For fiscal year 2005, this level of 

productivity translates into VBA completing almost 826,000 rating-related 

decisions. VBA completed about 763,000 decisions in fiscal year 2005. It is

not clear whether these measures will enable VBA to achieve its planned 

improvements in productivity. 

Organizations studying these challenges have suggested that they could be 

addressed by more strategic, comprehensive restructuring than has been 

done to date. For example, in a 1997 report, the National Academy of 

Public Administration found that VA could achieve significant savings in 

administrative overhead costs by closing a large number of regional 

offices.11 Similarly, in its January 1999 report, the Congressional 

Commission on Servicemembers and Veterans Transition Assistance 

found that some regional offices are so small that their disproportionately 

large supervisory overhead may unnecessarily consume personnel 

resources.12 The commission highlighted a need to consolidate disability 

claims processing into fewer locations. VBA has consolidated its 

education assistance and housing loan guaranty programs into fewer than

 11National Academy of Public Administration, Management of Compensation and Pension 

Benefits Claims Processes for Veterans (Washington, D.C.: August 1997). 

12Report of the Congressional Commission on Servicemembers and Veterans Transition 

Assistance (Washington, D.C.: Jan. 14, 1999). 

Page 10 GAO-06-149 Veterans' Benefits
10 locations, and the commission encouraged VBA to take similar action in 

the disability programs. 

In its own 1995 study of field restructuring, VBA enumerated several 

potential benefits of consolidating processing into fewer than 57 regional 

offices.13 These included allowing VBA to assign the most experienced and 

productive adjudication officers and directors to the consolidated offices; 

facilitating increased specialization and as-needed expert consultation in 

deciding complex cases; improving the completeness of claims 

development, the accuracy and consistency of rating decisions, and the 

clarity of decision explanations; improving overall adjudicative quality by

increasing the pool of experience and expertise in critical technical areas; 

and facilitating consistency in decision making through fewer 

consolidated claims processing centers. 

Consolidating compensation and pension claims processing into fewer 

offices would not necessarily mean that regional offices would be closed.

As the VA Claims Processing Task Force suggested, regional offices that 

lose claims processing functions could still provide public contact and 

outreach services. Also, VBA officials suggested that these offices could 

continue to provide vocational rehabilitation and employment services. 

No matter which alternative VBA chooses to pursue in making further 

changes to its field office structure, it will need to address an array of 

human capital and real property issues. These include, for example, (1) 

assessing what mix of incentives—such as buyouts, early retirements, or 

retention bonuses—would be needed to accommodate downsizing at 

some offices and workload increases at others, (2) what additional 

training would be needed to ensure staff could take on new 

responsibilities, and (3) how office space could be disposed of or acquired

as needed to accommodate workload shifts. At the same time, given 

potential resistance to changes in field structure, VA would need to find 

effective ways of communicating its plans while enhancing staff morale 

and productivity. 

 13Veterans Benefits Administration, Field Restructuring: Progress Report and Transition 

Year Recommendations (Washington, D.C.: December 1995). 

Page 11 GAO-06-149 Veterans' Benefits
VBA has taken limited actions to realign its field structure and redeploy 

staff resources as part of its effort to improve overall claims processing 

performance. While targeted at specific types of work and specific 

regional offices, these actions have not been in the context of a 

comprehensive restructuring strategy. Rather, VBA has made piecemeal 

changes, many in the context of short-term performance improvements, 

particularly in claims processing efficiency. Unless more comprehensive 

and strategic changes are made to its field structure, VBA is likely to 

continue to miss opportunities to substantially improve productivity, 

accuracy, and consistency in its disability claims processing, especially in

the face of future workload increases. 

To help ensure more timely, accurate, and consistent decisions in a costeffective manner, we recommend that the Secretary of Veterans Affairs 

direct the Under Secretary for Benefits to undertake a comprehensive 

review of VBA’s field structure for processing disability compensation and 

pension claims. This review would address staff deployment, 

opportunities for consolidating disability compensation and pension 

claims processing, and human capital and real property issues. 

In its written comments on a draft of this report (see app. II), VA agreed 

with our conclusions and concurred fundamentally with our 

recommendation that it undertake a comprehensive review of VBA’s field 

structure for processing disability compensation and pension claims. VA 

stated that it will establish a task force to thoroughly explore potential 

areas for further consolidation. VA also noted that field restructuring is a

complex process that involves, among other things, obtaining input and 

support from service organizations, members of Congress, and labor 

partners. We agree that field restructuring is a complex process but urge 

VA to establish its task force expeditiously to ensure that VA can achieve 

the potential benefits of field restructuring as soon as possible. As VA 

noted in its comments, these could include improved proficiency, greater

accuracy, and consistency in operations. 

We will send copies of this report to the Secretary of Veterans Affairs, 

appropriate congressional committees, and other interested parties. The 

report will also be available at GAO’s Web site at http://www.gao.gov. 

Conclusions 

Recommendation for 

Executive Action 

Agency Comments 

and Our Response 

Page 12 GAO-06-149 Veterans' Benefits
If you or your staff have any questions regarding this report, please call me 

at (202) 512-7215. Carl Barden, Irene Chu, Martin Scire, Greg Whitney, 

Vanessa Taylor, and Walter Vance also made key contributions to this 

report. 

Cynthia A. Bascetta 

Director, Education, Workforce, 

 and Income Security Issues 

Page 13 GAO-06-149 Veterans' Benefits
Appendix I: Scope and Methodology Appendix I: Scope and Methodology 

To develop the information for this report, we reviewed prior studies on 

Veterans Benefits Administration (VBA) claims processing, including the 

1995 report of VBA’s Field Restructuring Task Force, the National 

Academy of Public Administration’s 1997 report on management of 

compensation and pension benefits claim processes for veterans, the 1999

report of the Congressional Commission on Servicemembers and Veterans

Transition Assistance, and the 2001 Department of Veterans Affairs (VA) 

Claims Processing Task Force report. We reviewed VBA’s model for 

allocating staff to its regional offices and discussed the allocation model 

with VBA officials. We also analyzed VBA staffing data from fiscal years 

2001 through 2004 for VBA’s regional offices. To determine the range in 

workload and performance of VBA’s regional offices, we reviewed VBA 

workload, timeliness, and accuracy data. 

To discuss VBA initiatives and the impacts of changes in staffing levels, we 

visited the VBA regional offices in Washington, D.C.; Boston, 

Massachusetts; Newark, New Jersey; Philadelphia, Pennsylvania; and Salt 

Lake City, Utah. Also, while visiting the Salt Lake City regional office, we 

interviewed by videoconference officials of the Anchorage, Alaska, and 

Fort Harrison, Montana, regional offices—which are operated by the Salt 

Lake City regional office. We selected the Philadelphia and Salt Lake City

offices because they have added, or are in the process of adding, workload 

through consolidations. The Philadelphia regional office hosts one of the 

three Pension Maintenance Centers; processes in-service dependency and

indemnity claims; and has taken jurisdiction for southern New Jersey from

the Newark regional office. The Salt Lake City regional office was in the 

process of expanding its staffing as part of VBA’s plan to consolidate 

Benefits Delivery at Discharge (BDD) claims decision making, and in fiscal

year 2004, it made almost 90 percent of the Anchorage regional office’s 

rating-related decisions. The Boston, Newark, and Washington regional 

offices were chosen because they had lost a large percentage of their staff 

since fiscal year 2001. Also, the Newark and Washington offices had lost 

jurisdiction to other regional offices in recent years. Finally, we visited the 

Washington office because it is the site of VBA’s Appeals Management 

Center. 

We assessed the reliability of VBA’s timeliness and workload data and 

found that the data were sufficiently reliable for the purposes of this 

report. For data at the VBA-wide level we relied on the assessment we 

performed for our November 2004 report on VBA’s fiscal year 2005 budget 

Page 14 GAO-06-149 Veterans' Benefits
Appendix I: Scope and Methodology 

request.1 For data on workload and timeliness at the regional office level, 

we used data from VBA’s Distribution of Operational Resources (DOOR) 

reports. We were unable to directly assess the reliability of the data 

contained in these reports because VBA officials responsible for putting 

together the DOOR reports do not receive claims-level data. For this 

reason, to corroborate the data in the DOOR reports, we obtained claimslevel data that had been archived by VBA’s Office of Performance Analysis

and Integrity (PA&I). We utilized PA&I’s methodology and calculated 

workload and timeliness numbers for September 2004 with minimal 

differences from those contained in the DOOR reports. This gave us 

reasonable assurance that the DOOR numbers accurately reflect VBA’s 

workload and timeliness. 

We assessed the reliability of VBA’s claims brokering data and found the 

data sufficiently reliable for the purposes of this report. We discussed 

VBA’s brokering data with VBA officials and reviewed guidance on 

reporting brokering data. According to VBA, regional offices work with 

VBA’s area offices to ensure that brokered cases are properly counted. The 

area offices, in turn, provide the data to VBA headquarters. These data are 

updated monthly. According to VBA, the Office of Performance Analysis 

and Integrity reviews and validates brokering data. 

We also assessed the reliability of VBA’s fiscal year 2004 benefit 

entitlement accuracy data and found that the data were sufficiently 

reliable to show the range in accuracy between VBA’s most and least 

accurate offices, but not to make further distinctions in accuracy among 

regional offices. We interviewed officials responsible for VBA’s Systematic 

Technical Accuracy Review (STAR) program and discussed their 

procedures for requesting cases for review. We obtained data by regional 

office on the number of cases requested and reviewed. We found that 

VBA’s STAR unit had requested, but never received or reviewed, hundreds 

of sampled cases from its regional offices. This could have affected 

regional office accuracy scores for fiscal year 2004. For example, the 

Washington regional office’s score was reported as 77 percent.2

 However, 

 1

GAO, Veterans’ Benefits: More Transparency Needed to Improve Oversight of VBA’s 

Compensation and Pension Staffing Levels, GAO-05-47 (Washington, D.C.: Nov. 15, 2004). 

2

Since the STAR rating accuracy scores are estimates for each office based on a sample of 

cases, these scores have margins of error associated with them. The Washington regional

office’s accuracy figure of 77 percent has a margin of error of no more than 7.6 percent at

the 95 percent level of confidence. 

Page 15 GAO-06-149 Veterans' Benefits
Appendix I: Scope and Methodology 

because a large number of cases were never received by the STAR unit, 

Washington’s accuracy score could have been as high as 87 percent or as 

low as 42 percent. According to VBA officials, VBA is now tracking cases 

that it requests as part of its STAR accuracy review sample and charges 

offices with errors if cases are not sent in for review. 

Page 16 GAO-06-149 Veterans' Benefits
Appendix II: Comments from the Department Appendix II: Comments from the Department of Veterans Affairs 

of Veterans Affairs 

Page 17 GAO-06-149 Veterans' Benefits
Appendix II: Comments from the Department 

of Veterans Affairs 

(130422) Page 18 GAO-06-149 Veterans' Benefits
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